Amazon made no open offer to buy stakes: Future Group

BENGALURU: E-commerce major Amazon did not make any open offer to buy stakes in Future Retail Limited (FRL) in 2019, when it acquired a 49 per cent stake in one of its group firms Future Coupons Private Limited (FCPL), FRL informed stock exchanges in a filing adding “that the contention raised by Amazon is entirely misconceived.” The Kishore Biyani-led retail firm added that there was no change in the control of the FRL in favour of Amazon in 2019 if at all an open offer was made. 

Last year, the US based e-commerce firm acquired a 49% stake in Future Coupons (FCPL) by investing Rs 1,500 crore. However, FCPL later went on to acquire a 7.5 per cent of the Future Retail (FRL) through the issue of 3.96 million warrants at a price of Rs 505 per warrant aimed to infuse nearly Rs 2,000 crore in FRL which was challenged with rising debt concerns. Amazon’s investment was thought of as a strategic move to get an indirect equity stake in FRL to be able to strengthen its e-commerce business by selling the FRL products on its platform. 

Meanwhile, FRL said that the emergency arbitrator in Singapore has overlooked the Indian firm’s assertion regarding the two separate agreements signed in 2019 and that emergency order passed by a single member arbitration panel is in violation of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.” Given that the EA Order is premised on violation of SEBI Regulations it cannot and ought not to be accorded any sanctity by SEBI, NSE and BSE,” FRL said. It noted that the EA Order is not enforceable under the provisions of the Arbitration and Conciliation Act, 1996 and is not binding on FRL.